How to work out how much your possessions are worth?

This is quite an important part of getting the right amount of insurance for you, so make sure you take your time and do it as thoroughly as you can. There are two methods you can use:

Method one:

Start by getting yourself something to write on, a plain old paper pad and a pen will do, or if you’re more modern, you can use a note pad function on your phone or tablet – or even a spreadsheet.

Divide the page into two columns – one for the item and a second of the value. Next, walk around your home, noting all the things you have in it. Go in every room, open cupboards, look in drawers and make sure you note everything down.

Now you need to find out what it would cost you to replace those things at today’s prices, if you’re thinking of a new for old policy. If you’re thinking of just having indemnity cover, which gives you the amount the item is worth now, not what it’ll cost you to replace new, you could look for an equivalent item on a second hand website. Or just use your best judgement as to what you think it’s worth, depending on how much wear and tear the item has suffered.

In fact, even if you have a new for old policy, you’ll still have to take wear and tear for things like clothes, bed linens and towels, into account. So, you should adjust the value down slightly to reflect that.

When you’ve finished, you simply add up the total cost and you’re done.

Method two:

Use one of the online contents calculators, like the one supplied by insurance company, Aviva, which is really just an electronic version of what you’ve done above. It allows you to add and remove items, save your calculations and print out the finished estimate for your records.

Other things you can do to lower your policy amount

Before we move on to comparing policies, there are some other things you might want to consider doing to lower the cost of your premium even further. These are:

paying upfront – paying in instalments is great if you don’t have a lump-sum you can pay out right now. But you will more than likely find that the policy costs you more this way. So, if you can pay the whole annual premium upfront, you should pay less.

raising your excess – the excess is the amount you’ll pay when you make a claim. Like with car insurance, there’ll usually be an amount that your insurer will insist you pay if you make a claim, this is called the compulsory excess. However, you can also add on a voluntary excess. Generally speaking, the lower your excess, the more expensive your policy. So, if you’re happy to raise your excess up, you should save on your annual premium amount.

improving your security – you should try to do all you can to prevent your belongings from being stolen. So, if you can improve the security on your property, it’d be a great idea. However, before you go and spend a huge amount getting new locks fitted, it may be worth asking potential insurers if it will make a difference.

Now you’re ready to compare policies.

How to compare home contents policies

All you need to do is enter the information you’ve gathered about the value of your possessions into a comparison site, such as USwitch. When you are presented with the results page you need to keep a couple of things in mind:

Are the quotes like for like? If one policy seems to be much, much cheaper than the other, have a look at why that is. Is the excess the same? How much is the single valuable article limit? How many times can you claim for certain items?

How does it rate on Defaqto? This expert-run site looks at all the home contents policies available in the UK, and then gives them a star rating. Obviously the better the star rating, the better the policy.

How do Which? rate the policy? This page gives you the best and worst rated products and companies available in the UK. After all, there’s no point having a great policy if you can’t get hold of the provider when you need them most.

Once you’ve found a policy you think is suitable for your needs and your budget, you should read through the terms and conditions really thoroughly. If there’s anything you’re not sure of, call the provider and ask, before you commit to anything.

Is there a charge for changing the policy details mid-term?

One more thing you may want to consider is what the provider charges for changing the policy mid-term. Some companies charge nothing, others do, so it’s worth checking this out, if you think you may be moving during the policy period.

Check your paperwork

Once you’ve decided on a policy and you’ve purchased it, you should receive your policy documents in the post or electronically. When you do, make sure you check that everything is correct, as again, mistakes can be costly if there comes a time when you need to claim off the policy. If you do spot something amiss, contact your insurer as soon as you can and alert them. They’ll correct the error and send you new policy documents – there should be no charge for this.

Cooling-off Period

However, if you do purchase a policy and when the paperwork arrives you find that you’ve missed something important, you can take advantage of the cooling-off period. This is a legal protection for you and lasts a minimum of 14 days after you bought the policy or when the paperwork arrives at your home. During these 14 days you can cancel the policy, for any reason, without questions. However, although most insurers do pay back everything you’ve paid so far, they are entitled to keep a small amount to cover their administration costs and for the days you were covered, before you made the decision to cancel.

Keep your details up-to-date!

This is just as important as making sure your details are correct at the time you take the policy. So, if you remodel your bedroom and invest in a wonderful antique bed, some plush new carpets, custom-made venetian blinds – you see where we’re going with this – you’ll need to up your policy amount to reflect the new overall value of your possessions. And the same applies if you purchase something that exceeds the single article limit for valuable, you’ll have to let your insurer know. This could be something like a new expensive laptop, or an engagement ring.

Making claims increases your premiums

It’s also worth bearing in mind that any claim you do make on your policies will almost certainly increase your premiums for the next year. So, think carefully about any claims you make for smaller value things, it may just be worth you using money you have saved instead of claiming on your policy.

Make sure you shop around at renewal!

Now you’ve got yourself a cracking deal for this year, you want to make sure that next year you’ll have another. One way to do this is to be proactive at renewal time. Many people make the mistake of just allowing their insurance to renew, without checking if there’s a better deal available, either with your current insurer or with someone else.

In our experience, this is not done deliberately, it’s simply an oversight. So, the first thing we’d advise you do is set a reminder for roughly a month before your renewal is due. This way, you’ll have time to shop around for the best deals. Then, when you get the new premium through the letter box, and it’s more than other providers are quoting, you can use that information to haggle with.

And that’s exactly what you should do – haggle! Don’t be afraid to tell your insurer that you’ve got alternative, like-for-like quotes that are cheaper than their renewal amount. They have some flexibility so may, and often do, match what you’ve been quoted, to keep your business.

If that doesn’t work, simply inform your current insurer that you do not wish to renew. And, as long as you’ve not passed the renewal date, it shouldn’t cost you anything to allow your insurance to end at this point. If it renews automatically, you can still cancel within the normal cooling off period, then take up the best offer you’ve had from the alternatives.

Okay, we hope you’ve got more of an idea about how to get yourself the best contents insurance deal. Tomorrow, in the final instalment, we’ll look at what a great contents insurance policy should contain. See you then!

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